Tesla management are trying to decide whether to keep an older piece of machinery or buy a replacement Management was presented with the following information to assist in their decision The old machine was purchased three years ago for $312,000 and has a current book value using straight-line depreciation of $193,000 The old machine incurs operating expenses of $38,000 per year. The current disposal value of the old machine is $79,000, if it is kept ten more years, its remaining value would be $16,000 The replacement machine would cost $229,000 and have a useful life of ten years. The replacement machine has an expected salvage value of $67,000 after ten years. The replacement machine would require $12,000 per year in operating expenses. Required Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced? Keep Old Machine Total costs Should the old machine be replaced? Purchase New Machine www Mant